Tokyo Lifestyle Strengthens Capital Structure Through Equity Issuances

Tokyo, Japan, Sept. 29, 2026 /CourierPR/ -- Tokyo Lifestyle Co., Ltd., a retailer and wholesaler of Japanese beauty and health products, sundry products, luxury items, electronic products, collectible cards, and trendy toys, has announced significant moves to strengthen its capital structure. On September 10, 2026, the company's board of directors approved two equity transactions, both scheduled to close on September 29, 2026.

First, the company’s Representative Director and Director, Mr. Kanayama, has agreed to subscribe for 1,396,755 Ordinary Shares of Tokyo Lifestyle for an aggregate cash consideration of JPY58,838,000 (approximately US$0.38 million). This payment is set for September 29, 2026.

Second, an entity owned by Mr. Kanayama and his family, Tokushin G.K., has agreed to contribute its JPY510,000,000 (approximately US$3.32 million) loan principal receivable from the company in exchange for 12,106,893 Ordinary Shares. The loan principal will be extinguished in full upon the completion of this contribution.

Together, these transactions are expected to strengthen the company’s capital base, optimize its balance sheet, and enhance its financial flexibility. The aggregate consideration for the two issuances is JPY568,838,000, equivalent to approximately US$3.7 million based on the exchange rate of JPY153.74 to US$1.00 used for pricing the transactions. The pricing benchmark was US$0.274 per Ordinary Share, equivalent to US$2.74 per American depositary share, with each ADS representing 10 Ordinary Shares.

These transactions reflect Mr. Kanayama’s and his family’s continued commitment to Tokyo Lifestyle.

The company and Tokushin entered into a subordinated loan agreement dated November 27, 2025, which was executed by both parties on February 24, 2026, providing for an unsecured loan of JPY300,000,000 with a fixed annual interest rate of 2.0%, payable monthly and originally repayable on January 31, 2031. In connection with the Debt-to-Equity Swap, the company and Tokushin entered into an amendment to the original loan agreement dated September 10, 2026. This amendment increases the loan principal amount to JPY510,000,000, provides for an additional advance of JPY210,000,000 on September 10, 2026, and changes the repayment date to September 10, 2026. The amendment also permits the loan principal receivable to be contributed to the company in exchange for newly issued shares, with the loan principal to be extinguished upon completion of the contribution.

The board approved the amendment and the terms of the two share issuances at its meetings on September 10, 2026. Mr. Kanayama did not participate in the deliberations or voting on the relevant matters due to his interest in the transactions. The proposals were unanimously approved by the other directors entitled to vote. The company’s three corporate auditors also unanimously expressed their opinion that the terms of the share issuances did not constitute a favorable issuance under Japanese law.

On September 10, 2026, the company published an electronic public notice in Japan setting forth the approved issuance terms. English translations of the public notice, the amendment, the Cash Subscription Agreement, and the DES Subscription Agreement were furnished as exhibits to a Form 6-K filed with the U.S. Securities and Exchange Commission on September 21, 2026.